Follow us on:

Market Analysis

Backed by positive cues from around the world , the Indian benchmark indices closed the week with a gain of 1.14% ( Sensex @ 32969 ) and 1.16% ( Nifty @ 10,114 ). The on-going talks to ease the trade war between US and China eased the pressure around the globe and Indian and Asian markets responded accordingly.

Going ahead, the first trading week of the new financial year unfolds and investors should keep watching the global trends which were driving the market sentiments for a while now. The March month auto sales numbers and the rupee and crude oil price movement are also important. Although the indices reacted positively last week , the short term trend still remains down. Whats important to watch is whether the indices can break the key resistance conclusively. The key resistance points or the Nifty and the Sensex are poised at 10,600 and 33,800. These are key hurdles and as long as the indices trade below these levels , it would be difficult to judge whether there is a confirmed uptrend or not.

As expected, the markets were influenced by global cues last week. The week that passed by witnessed the global markets skidding on the prospects of a trade war. The on-going trade war between US and China over shadowed even the Fed rate hike and increase in GDP forecast. Another factor that contributed to the downfall of the markets was the resultant rise in crude oil and gold prices. Overall, Indian markets fell in line with the global sentiments registering an almost 2% fall. It is to be remembered that both the Nifty and the Sensex had registered a 4.8% fall last month and it is heading for another close in red this month.

Going ahead, the short term trend continues to be down. The Nifty closed below 10,000 for the first time since last October and it has breached the 200 day moving average which was poised at 10,150. The Sensex too, has breached all the immediate support levels including the 200 day DMA. It would be unrealistic to expect any strong positive movement this week considering that the March derivatives expiry is coming up. A further fall in the indices will reinforce the downtrend and bearish sentiments will become more and more prominent. Hence ‘wait and watch’ is the mantra of those who are trying to enter the markets with money. Investors who have already made profitable positions can think of booking profit or averaging the cost down depending on the future prospects of the stock they’re holding.

The equity markets will be shut down on Thursday and Friday on account of Mahavir jayanthi and Good Friday. The near term trend will be dictated by F & O expiry , macro data like US and UK GDP , FII and DII activity and the movement of crude oil and Gold prices.

Once again, the Indian market indices closed on a negative note – The Sensex Closed at 33,176 and the Nifty closed at 10,195 due to negative cues such as possibility of political instability in 2019, The impact of the PNB scam and the RBI’s blanket ban on issuing LOU and widening current account deficit.

Going ahead, the US fed meeting is the big event coming up. Experts say that a rate hike is possible. The crude oil price movement is also important to watch. As far as the Nifty is concerned, it is hovering just above the 200 day moving average at 10,150. Multiple closing below the moving average can drag the index down to 9,200-9,500 levels in no time. So traders need to be extra cautious in taking positions. For the week ahead, we expect the Sensex to trade in a range of 32,500-33,500 and Nifty in a range of 10100 – 10300. A bullish momentum is hard to come in the present scenario.

Led by the continuing carnage in PSU Banking stocks, the India benchmark indices – the Sensex and the nifty closed at 33,307 and 10,227. The selloff in metal stocks and weak global sentiments further added fuel to the Indian markets making the sentiments bearish.

Going ahead, there is a slew of economic data to be released and the market movements are likely to be influenced by these numbers which includes – IIP data for January 2018 and inflation numbers for February. The markets are also likely to be influenced by the outcome of the GST meeting that concluded on last Saturday. Other factors that are likely to influence market movements include – crude oil movement and US CPI data for February.

Overall, the present scenario does not look cheerful. The stock indices show a downward tilt and it is likely to continue the downward movement in the short term.

About Jins Victor

Jins Victor is the founder of www.sharemarketschool.com, a website for share market enthusiasts. Based in Kochi, he heads one of the leading financial consultancy firms in Kerala. He is an avid follower of stock markets and invests in his own account. Through this website, he shares his experiences and knowledge and teaches how to make money from share markets using solid rules.

Subscribe

You can get the latest posts delivered to you for
free via Email or RSS